Booth Industries has liabilities of $105 million and total assets of $350 million. Its debt ratio is 40.0%.
Debt Ratio = Total Liabilities/Total Assets
Debt Ratio = $105 million/$350 million = 30%

Question

Quizplus · Accepted Answer

The calculation given for the debt ratio is incorrect. The correct calculation is 105/350 = 0.3, or 30%. Therefore, the correct answer is B, false.

Booth Industries Has Liabilities of $105 Million and Total Assets